Let's say you create a resource pool with all the default settings. Now add eight VMs to this pool called Prod. If you have another resource pool and some other VMs at the root resource pool (cluster), then your resource pool will get 4,000 shares by default, and those VMs that are in the root resource pool will get 1,000 shares.

In this case, the percentage of shares of the resource pool will be same for all the pools. But if you keep on placing VMs inside the pool, then it will be divided amongst all of them. The following is an example of what could happen in this situation.

You have a Prod resource pool with 1,000 shares of CPU and four VMs within it and a Dev resource pool with 4,000 shares of CPU and 50 VMs.

The Prod resource pool with 1,000 shares and four VMs is greater than or equal to 250 units per VM (small pie, a few big slices):

The Dev resource pool with 4,000 shares and 50 VMs is greater than or equal to 80 units per VM (bigger pie, many small slices):

Also, note that shares will only come into play when there is contention. However, if the shares for the VMs aren't allocated properly, this can be an issue. It may happen that your non-production VMs may get higher priority than the more critical VMs.

Folders provide a simple structure and nothing else. You can have as many folders as you want.